X-Axis

Logarithmic

Y-Axis

Logarithmic

Y-Axis 2

Logarithmic

Policy

Climate

Economy

Technology

Fossil fuels

Welfare

Damages

Choose among four types of policies. Business as usual assumes
that there are no controls on CO2 emissions. Choosing an
optimized policy allows the computer to choose an emissions
reduction plan that maximizes welfare (measured by the present value
of utility). A simulated carbon tax allows you to pick a
global tax rate on emissions for each of three periods. A climate
treaty allows you to choose emissions reductions from a
2005 baseline for each of three target dates and the portion of
world emissions that are subject to the treaty.

Business as usual

Optimized policy

Be aware that optimized policies can take about ten
seconds to run, depending on your input parameters—and a bit longer
longer if you’re using a BEAM carbon cycle.

Emissions reduction(% 2005 emissions)

Participation(% of globe)

20501000100

&bullet;

21001000100

&bullet;

21501000100

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How bad climate change will be? Climate sensitivity is a
measure of how much temperatures will increase if CO2
in the atmosphere doubles. A higher sensitivity means a greater
temperature increase for a given level of emissions. Climate model
is the model of what happens to emissions once they are released.
The DICE model is the model that is built into the standard version
of DICE. BEAM is a slightly more realistic model that includes ocean
chemistry. Linear is a simple but reasonably accurate model that
is based on cumulate carbon emissions.

Climate sensitivity3.215

&bullet;

How much will temperatures go up? Or: how much will temperature
increase in degrees C from a doubling of atmospheric CO2?

Climate model

DICE carbonBEAM simplifiedLinear (°C / 1000 GtC)

How would the economy would perform without climate change? The model
assumes that the productivity of the economy increases but the rate
of increase slows over time. You can choose the rate of this slow
down. Depreciation determines how fast assets wear out in
the economy. Savings is the portion of output that is
reinvested in the economy. The maximum population determines
how many people the earth will eventually hold.

Productivity0.9.051.5

&bullet;

Decline in the rate of growth in productivity over time.

Depreciation (%)10820

&bullet;

Rate at which physical assets (buildings, machines, etc.) wear out.

Savings (%)221525

&bullet;

Savings rate per year.

Max. population (BB)8.78.012.0

&bullet;

Maximum level of the global population, in billions.

How much will clean energy technology cost? You can choose both how
fast clean energy costs will go down and how far they will go down.
These costs determine the effects of an emissions reduction policy and
do not come into play in the business as usual scenario.

Abatement costs2.824

&bullet;

Marginal cost of reducing emissions. This represents the additional
costs from more abatement.

Cost decline (%)5020

&bullet;

The rate of decline in costs of reduction emissions—hpw fast will
these costs decline over time?

How fast will emissions go down due to efficiency improvements—and
because of the limits to fossil fuel reserves. Energy intensity
determines how efficient the economy is. As the economy becomes more
efficient, it can produce more using less energy and, therefore,
fewer emissions. The model assumes that the economy gets more efficient
over time. You can choose how much more. Fossil fuels is the
total recoverable fossil fuels, measured in gigatons of carbon.

Energy intensity (%)0.606

&bullet;

Reduction in energy intensity per decade. Or the rate of decline
in energy use per $ of GDP.

Fossil fuels (GtC)600060009000

&bullet;

Fossil fuel reserves remaining, measured in CO2 emissions

Choose parameters that determine the individual utility function and
the discount rate applied to future utility. Eta determines how
fast marginal utility declines with income, with higher values meaning
that utility increases less as people get richer. Rho is the
discount rate applied to utility.

Eta1.513

&bullet;

Elasticity of marginal utility. This is the exponent of consumption
in the utility function.

Rho (%)1.513

&bullet;

Pure rate of time preference, and the discount rate applied to utility.

How will climate change harm the economy? The default model in
DICE assumes that harms increase as temperatures increase by
reducing usable output. Harms determines how fast they
increase: harms are effectively the temperature increase raised to
the exponent you choose. Model allows you to different
functional forms or to allow climate change to effect the economy
in a different way (such as reducing the growth rate of productivity
rather than by reducing usable output).

Harms2.014

&bullet;

How large will the harms to the climate be, due to an increase
in temperatures?

Damages function

webDICE is built and maintained by the Center for
Robust Decision Making on Climate and Energy Policy at the University
of Chicago. Questions and comments should be directed to
info-rdcep@ci.uchicago.edu.

Warning

The parameters you chose produce a result that is physically
impossible. This can occur because climate change causes harms
that are sufficiently bad that the economy is forced to operate
below subsistence levels. It may also occur because you have
specified emissions reductions that are greater than the emissions
from the participating countries. webDICE does not contain the
flexibility to predict what might happen as we approach these
circumstances so it continues to produce the graphs under the
parameters you chose.

Although the results are not physically possible, it does not mean
that they are not meaningful. webDICE is telling you that under the
parameter choices you made, something very extreme will happen:
the population will have to shrink because the economy cannot support
the full population, or the emissions reductions cannot be achieved
with the participation rates. The particular results in the graphs,
however, are not meaningful.